Is Google TV WebTV Part Deux?

The just-announced Google TV operating system, which is set to launch on Sony (s SNE) TVs and Blu-ray players, as well as a Logitech (s LOGI) broadband set-top box, has been labeled a game-changer by some. But for all the talk about how revolutionary the Google TV concept could be, there are still some serious questions yet to be answered.

And beyond the purely technical questions of which codec Google plans to use, or whether or not Hulu will be viewable on Google TV devices, there are more strategic and important questions — namely whether or not people even want what Google is selling with its new TV initiative. So is Google confused about how consumers want to use their TVs? Do people want the whole Internet through their connected devices, or is a walled garden of select content enough?

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Michael Gartenberg on Engadget draws a comparison between Google TV and the much-maligned WebTV service that Microsoft (s MSFT) bought and tried to sell to consumers way back in the late 90s. The crux of his argument is as follows:

“Research has shown time and time again that consumers don’t want the whole internet on their TVs. Consumers simply don’t want Gmail or Twitter or the “whole” web on the TV. There’s a fundamental difference between what Google is offering and what consumers want — and, importantly, what they’re willing pay for.”

To a certain extent, Gartenberg does have a point — what Google TV is selling isn’t that different from a “long line of niche products” that have come before. After all, WebTV was a colossal failure for its time, and TiVo has had integrated broadband services for years. And the majority of today’s web-connected TV makers have been careful to ensure that the services they offer are well-selected and integrated with the TV’s look and feel. That is, the interface for Netflix on a connected TV doesn’t mimic the subscription rental firm’s web interface, but conforms to the same type of browsing that one is used to through a TV programming guide.

However, there’s an important point that Gartenberg is missing: Not only is consumer behavior changing, but the type of experience people find on the web — particularly in the case of video — is as well. The Internet is no longer the text-heavy, link-laden place it was back in the late 90s. And services like Hulu and YouTube — which increasingly mimic the TV experience — have taken over consumer mind share. That’s not to say consumers will want to do everything they do on a PC on the TV — but having the option to do so isn’t the worst thing in the world.

But in the same way that Apple’s (s AAPL) iPad has gained consumer acceptance where other tablet devices failed, Google TV may be coming to market at a time when the user mindset — and the supporting online services — might actually be ready for such a product.

I’m afraid Google will miss this point. Apple iTunes succeeded not because of the cult-like dedication to the brand, but because they brought the five major record distributors to the table, standardized pricing and made 99% of everything in the library available for sale.

For “Google TV” to mean anything, it needs to deliver 99% of existing pay-tv streams atomically, so we can buy them by the hour, day, week, show, series, etc, at a price we’re willing to pay.

If its just another Hulu, Veoh, or other cumbersome semi-transparent screen interface to a billion YouTube videos, or a bunch of overpriced second-rate movie rentals, it will fail, miserably.

Google needs to answer a few fundamental questions. Lacking this clarity, GTV sounds like another tech fantasy queuing up for a reality check.

a) Content is king.
If only Google had brought the content guys to the party instead of fellow nerds from sony, logitech and intel, … Google sure must have tried. Will Google tell us why the king was absent?

b) What’s in it for the advertisers?
TV spots are understood. Ad Sense is understood. But what will fuel the GTV? Let’s make no mistake here. No ad model = FAIL.

c) What’s in it for consumers? (other than android apps that make sense on a mobile and a search bar that makes sense on a PC)? Yet another box around my TV. And a remote control + TV UI that will scare the hell out of average TV users. (imagine entering your google password on the TV).

d) Finally, the TV companies. If Sony will actually mass produce those atom (bomb!) based Google TVs, by the millions, Samsung, Panasonic, Vizio etc will only be too happy. Sony’s TVs will likely be at least 25% more expensive than the rest.

“thereâ€™s an important point that Gartenberg is missing: Not only is consumer behavior changing, but the type of experience people find on the web â€” particularly in the case of video â€” is as well”

Things are changing and so are people’s habits and needs. Just because something didn’t work 12 years ago doesn’t mean it won’t in 2010.

Google TV, in my opinion, will NOT go the way of the Web TV. As rightly noted in the article, consumer behavior has changed today and people are more open to receiving the same content through different end devices.
What Google TV (and others like Apple that will follow it) does is provides the users with a genuine opportunity to break the shackles of exorbitant pricing and bundling imposed by the cable TV industry. And for sure the consumers will be happy about that, at the right price. If Google can get away with free content (for a one time device cost as is being reported), then we have a very serious chance to make this a success.http://bit.ly/dfTqZ8